If you are new to the blog, click HERE to start at the beginning of my story.

POST #15

Before I start today, I want to mention that I did a radio interview with Marc Pearlman on YourMoneyMattersRadio. It is set to air on Monday, May 3, 2010 on AM radio, podcasts and iTunes Radio. Marc is a top-notch financial advisor and runs an excellent consulting firm and radio show. Please visit YourMoneyMattersRadio and find out where you can hear the show.

Now back to my story.

After 100 days past due, things started heating up. As they say in the debt settlement business, “The debts are getting ripe.”

Essentially, the debt moved to another department whose representatives (salesman!!!) were responsible for cutting settlement deals in the 50%-85% range.

On November 23, 2009 I was 132 days late on one of my accounts.

I called the bank for the 15th time and told them my story. However, since it was over 90 days passed due and the debt had been transferred to a new department, it was time to float the word “settlement”. I took a deep breath before I mentioned that word, thinking it would come at great resistance. I felt like a hospice nurse asking the family if it was okay to “pull the plug” on their dear loving family member. I expected the rep to be outraged by my egregious and forthright suggestion. Instead, the conversation didn’t skip a beat and the rep said we could work something out.

Wow! That was easy…..almost.

Their offer was for 85%.

HUH?

I said that would be impossible but I MIGHT be able to come up with $10K if I can make 3 payments over 3 months. The rep was hesistant and then put me on hold.

I was filled with excitement at the prospect of settling my first account. The fact that they were even considering a debt settlement was amazing!

But……

The rep came back on the line, and instead of addressing my offer, tried to get me to make a payment of $500.Â He said if I make a payment of $500, it would prevent my account from going to “charge off” and give us more time to negotiate a deal.

Charge off is when the bank writes off your account as a bad debt and a business loss.Â This is seemingly bad for me as a consumer because it hurts my credit rating. However, the ship had sailed on trying to protect my credit rating. I had already come to terms with that reality once I committed to debt settlement. Rebuilding my credit was another task to address once the debt settlement process was complete.Â Sorry bank….you can’t lord that over me anymore!Â As for making a payment to prevent charge off, that was another story and my CRN rep gave me some advice.

DON’T GIVE IN!!!

CLIFFHANGER!!!!!!

In the next post, I’ll discuss why that is good advice and how it worked out for me.